subscribe to ENR magazine subscribe
contact us
careers industry jobs
events events
Dodge Data & Analytics
ENR Logo
Web access will be provided
as part of your subscription.

Granite Plans to Acquire Kenny, Adding Power-Related Market Clout

Text size: A A
----- Advertising -----

Hoping to make itself a key player in high-voltage transmission and substation contracting, Granite Construction Inc. announced Dec. 28th an agreement to acquire Kenny Construction Co. for $130 million.

Based in Northbrook, Illinois, Kenny is perhaps better known for its tunnel projects, especially those in the Chicago area and the company’s role in helping end the Chicago flood of 1992. Kenny ranked No. 200 on ENR’s Top 400 Contractors, based on 2011 new contracts of $172.4 million.

Watsonville, Calif.-based Granite, in comparison, ranks 25th on the ENR Top 400 Contractors, based on new 2011 contracts valued at $1.9 billion.

Privately held, Kenny is over 85 years old and its seven-member board of directors has five Kenny family members. Two non-family board members, Michael Africk and Michael Futch, joined the board this year. The company has 425 employees and projects 2012 revenue of $270 million, according to Granite.

In addition to locations in Illinois and Ohio, Kenny has offices in Breckenridge , Colo., Philadelphia, Pa., Indio, Calif., and Fairmont, W.V.

In a press conference, Granite CEO James Roberts said that in addition to Kenny’s substantial business in power and tunnels, Granite would benefit from Kenny’s experience in water and underground construction.

Kenny's portfolio is filled with infrastructure such as highways, waterways, tunnels, rail systems and bridges. Although infrastructure funding now is uncertain, and Kenny's home state of Illinois is not immune, says Roberts, public-private financing in Illinois is “promising.” About $3 billion to $4 billion in annual spending in the Chicago area can be counted on, says Roberts.

Pipe and Target End-Markets

There are other reasons Kenny was attractive, says Roberts.

For one, the company has a substantial business in cured-in-place, large-diameter pipe liner, one of only a handful of companies that specialize in this service.

For another, the Kenny acquisition will allow Granite to dig more deeply into its target end-markets in power delivery and water infrastructure, with opportunities for Kenny to self-perform or have Granite units perform work Kenny traditionally has subcontracted, says Roberts.

FMI Corp. advised Kenny on the deal.

Chris Daum, an FMI investment banker, notes that Kenny recently completed the $900-million design-build contract for the Trans-Allegheny Interstate Line (TrAIL), involving construction and installation of about 180 miles of 500 kV single circuit extra high voltage transmission lines from southwestern Pennsylvania through West Virginia to northern Virginia.

The two companies have similar overall gross margins, says Roberts, with Kenny's power work running a little lower when the work is cost-reimbursable with less risk.

Roberts says Granite intends to couple existing offices with Kenny's underground and power market operations so that those operations can expand in California,  the Western U.S. and other areas.

The acquisition comes on a year that marked the 20th anniversary of what's been called the Great Chicago Flood, when damage to a utility tunnel allowed Chicago River waters into basements in large parts of the city. Kenny Construction is credited with stopping the flooding.


----- Advertising -----
  Blogs: ENR Staff   Blogs: Other Voices  
Critical Path: ENR's editors and bloggers deliver their insights, opinions, cool-headed analysis and hot-headed rantings
Project Leads/Pulse

Gives readers a glimpse of who is planning and constructing some of the largest projects throughout the U.S. Much information for pulse is derived from McGraw-Hill Construction Dodge.

For more information on a project in Pulse that has a DR#, or for general information on Dodge products and services, please visit our Website at

Information is provided on construction projects in following stages in each issue of ENR: Planning, Contracts/Bids/Proposals and Bid/Proposal Dates.

View all Project Leads/Pulse »

 Reader Comments:

Sign in to Comment

To write a comment about this story, please sign in. If this is your first time commenting on this site, you will be required to fill out a brief registration form. Your public username will be the beginning of the email address that you enter into the form (everything before the @ symbol). Other than that, none of the information that you enter will be publically displayed.

We welcome comments from all points of view. Off-topic or abusive comments, however, will be removed at the editors’ discretion.